Tips to Filing Your Taxes for the Young Professional

Posted by Thomas Leusner on

Believe it or not, one third of Americans actually like or love doing their taxes, according to Pew Research Center. Of course, if you do the math, that leaves two-thirds of us who either didn’t like or hated the annual exercise. Whether you love or hate tax season, these tips will keep you sane and organized as you file your taxes.

Know the tax return due date

The 2018 tax filing due date is Monday, April 15, 2019.  If you don’t think you’ll be able to file by then, you may file for an extension, in which case you’d have until Tuesday, October 15, 2019 to file.  Keep in mind that an extension is only an extension to file and not an extension to pay. So, if you know you will have a balance due to the IRS, you want to make sure your payment is made by April 15, 2019 to avoid interest and penalties.

Gather your documents and stay organized

Most of your tax documents will arrive in late January and early February.  These days, most tax documentation will be available online to download securely.  If not, you will receive copies of your tax forms via mail. As these documents arrive, you should create a paper folder and an electronic folder to keep your records in order.  Documents that you want to look out for include Form W-2s from employers reflecting your annual wages and tax withholdings, Form 1099s from banks and investment accounts reflecting your investment earnings, and Form 1098s from lenders (i.e., mortgage lenders and student loan lenders) reflecting your interest paid for the year.  Some documentation that you may not think to include are charitable donation receipts, payments for medical and health care, child care cost receipts, gambling winnings and losses, property tax receipts, rent payments, and tuition payments (often will receive Form 1098-T).

A helpful tip is to create a spreadsheet for your tax records so that you can track your tax deductions and expenses throughout the year.  Include titles in your spreadsheet to indicate your expense descriptions, check numbers, dates, and dollar amounts. This will help you stay organized all year long.  In addition, to maintaining a spreadsheet, it is important to keep track of life-related documentation. Make copies and keep original certificates of marriage, divorce, adoption papers, social security cards, and birth certificates.  For homeowners, keep your closing documents. There may be deductions on these closing forms related to real estate taxes and mortgage interest that do not appear on your yearend tax statements. You should also keep track of any contributions made to any retirement accounts.  These contributions can be tax deductible as well.

After you file

You should always maintain copies of both your federal and state income tax returns.  A good tip is to create a file and save your tax returns from year to year. Make sure to save both your tax returns and any supporting documentation used to prepare the tax returns (documents referenced above).  This information will come in handy if you are looking to purchase a house, apply for student loans, or check the status of your refund. Banks often require past years’ tax returns as well as supporting documentation before they will approve you for a mortgage or loan.  It is a good practice to hold your tax documents for at least three years. The IRS and most state authorities can audit your tax return for up to three years.

Now that you are organized, filing your taxes for this year and going forward will be easy.  You know what to look for and how to maintain good records. Happy Filing!

Lance Aligo, CPA, MSA, is a senior accountant at KRS CPAs, LLC, Paramus, NJ.  You can reach him at or 201-655-7411. Check out for more tax tips, checklists, blogs, and other resources to help you succeed.